Performance related pay - does it work?

Stephen Brooks

PA Consulting Group

BBC Radio 5 Live

21 January 2008

When BBC Radio 5 Live needed expert commentary on the issue of performance-related pay they turned to PA, and consultant Stephen Brooks gave his views on a series of live questions from the public.

The programme looked at what performance-related pay is, what is best practice, and the differences between public and private sector approaches - a debate that had been triggered by news of possible performance-related pay for the UK's police officers.

Speaking live to the programme host, Victoria Derbyshire, and fielding live questions from phone-in callers, Stephen Brooks pointed out that you have to be really clear about what you mean by good performance. If you assess the wrong things then you can get perverse outcomes. For example, if you judged police officers solely on how many arrests they made, we would end up with officers only interested in arrests and that is not what we want.

Stephen went on to say that performance related pay is easier to manage in the private sector because we can use profit as a catch-all to measure the performance of the whole organisation. We can then see how much people have contributed to it.

It is more complicated in the public sector because we judge these organisations and their people on quality as well as quantity. But that does not mean it cannot be done.